Neurosurgeon gets $17.5 million award after Swedish Health firing

Originally published September 15, 2017 at 6:00 am
Updated September 18, 2017 at 9:00 am

Dr. David Newell (Handout photo)

Dr. David Newell won a $17.5 million decision after arguing Swedish Health fired him in retaliation for questioning the practices of another top surgeon. Swedish says Newell was fired because he failed to notify the organization that he had been arrested in a prostitution sting.

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An arbitrator has awarded $17.5 million to a former Swedish Health neurosurgeon who says he was fired in retaliation for questioning the practices of another top surgeon.

Dr. David Newell lost his job a year ago, and Swedish contends he was fired for failing to notify the organization that he had been arrested and jailed in a Seattle prostitution sting. Swedish, along with parent organization Providence, is now challenging the arbitrator’s award in court.

“For this arbitrator to award Dr. Newell $17.5 million — at a time when many people cannot afford health care or fear losing their insurance, and when there is an epidemic of sex trafficking and exploitation of women — is unconscionable and outrageous,” said Swedish’s CEO, Dr. Guy Hudson, in a statement.

Newell contends the prostitution issue was used as cover to get rid of him after he had raised internal concerns about Dr. Johnny Delashaw, a star surgeon who was the subject of a recent Seattle Times investigation, subsequently resigned and had his state license suspended. Delashaw faced numerous internal complaints from a variety of Swedish staffers. Records filed in Newell’s case show Newell was among those who had raised issues about Delashaw.

“The evidence showed the actions (Swedish and Providence) took against Dr. Newell were part of a pattern of targeting and interfering with established neurosurgeons’ practices, retaliatory behavior, and a disregard for patient safety,” wrote Newell attorney Robert Sulkin in a court filing Thursday. “The evidence likewise established that (Swedish and Providence) stole the practice Dr. Newell spent a career building.”

Newell’s attorneys have requested that a judge confirm the arbitrator’s award, which included $16.5 million for lost earnings and $1 million for emotional distress. Swedish called the lost-earnings amount “insanity,” suggesting that the court should toss or modify the award, and arguing that the amount should, at most, be based on his projected earnings for a year, which was the length of his contract.

Swedish wrote in court records that Newell would have to conduct more than 3,000 complex brain-aneurysm repairs in a year to earn $16.5 million in compensation. Tax records show Newell earned $1.69 million in 2014.

The surgeon said through his attorney in court records that he began reporting concerns about Delashaw more than a year before The Times investigation was published. In one memo from 2015, he expressed concern that Delashaw was trying to marginalize him, taking some of his work and seeking to get him fired for flimsy reasons. He later argued in court records that Delashaw retaliated against him by dismantling his practice and harassing him. That included an accusation that Delashaw sought to humiliate Newell by secretly videotaping Newell as he was moved out of his longtime office to another location.

In July 2016, police say, Newell went to a University District massage parlor where police had set up a sting operation. Authorities say Newell requested sex, asked the woman there to “pinkie swear” that she was not a police officer and then paid $140. He was arrested. Newell later pleaded guilty to soliciting a prostitute, according to records, and agreed to pay a fine and do 80 hours of community service.

Swedish said Newell’s employment agreement required him to immediately notify the organization if he had been under any “criminal investigation” and noted he had been placed under arrest and booked into jail in the prostitution case. Newell said in testimony that he didn’t immediately tell Swedish because he was waiting in the days after his arrest until he got information in the mail about his case.

“At no time did (the Seattle Police Department) or the Seattle City Attorney inform Dr. Newell — verbally or in writing — that he was the subject of a criminal investigation,” his attorneys wrote in the arbitration case. “Nor did he have any knowledge of the existence of a criminal investigation.”

During the arbitration proceedings, a Swedish attorney asked the police detective in the case whether “it would take a brain surgeon to understand that a criminal investigation had occurred.” The detective said it wouldn’t.

While Newell is no longer a Swedish employee, he has continued to perform surgeries at the Cherry Hill facility, where he has privileges to operate. The state Department of Health determined in May that he had committed unprofessional conduct and that he may face sanctions, but the state still lists the case as pending.

Delashaw, meanwhile, is seeking to get his license back. A state hearing in his case is scheduled for next month.